Virgin Media parent Liberty Global donates £700,000 to remain but says it may reconsider future network investments if UK votes out at EU referendum
Virgin Media’s parent Liberty Global says future investment in its UK network could be jeopardised if the UK votes to leave the EU next week, but its current £3 billion ‘Project Lightning’ expansion is not at risk.
Speaking to the Financial Times, Liberty Global CEO Mike Fries said a ‘Brexit’ would cause unnecessary political, regulatory and economic uncertainty that could result in UK consumer and businesses spending less on communications services.
Virgin Media’s public affairs department has repeatedly stressed the need for a ‘stable’ regulatory environment if it is to continue to invest and has opposed any move by regulator Ofcom to separate Openreach from BT. And now it is has put its money where its mouth is in the EU debate.
Virgin Media EU
However Fries said Project Lightning was at too advanced a stage to be cancelled. It is expected that Project Lightning will increase Virgin’s footprint from 12.9 million homes and businesses today to 17 million by 2019. Half a million properties will be added this year alone.
“Would we undertake that sort of commitment again?” Fries told the FT. “We would have to question that.”
Virgin Media CEO Tom Mockridge has also sent an email to the company’s 14,000 employees urging them to vote remain next week, as has his counterpart at BT, Gavin Patterson.
An open letter signed by Patterson, BT chairman Sir Michael Rake and Communications Workers Union (CWU) deputy general secretary Andy Kerr and Prospect national secretary Ben Marshall was sent to BT’s 81,400-strong workforce.
Research from the Economist Intelligence Unit (EIU) has suggested telecoms operators would suffer lower revenues and investment would decrease if a Brexit occurs. A predicted recession in 2017 would cause demand to slide, the report says.
It adds that as a member of the EU, telecoms investment would rise by 29 percent between 2015 and 2020 compared to 23 percent in the event of a Brexit, while revenues would rise by 21 percent over the same period if ‘remain’ wins, while they would increase by just 12 percent if the ‘leave’ campaign is victorious.